How to value mLovenox if tLovenox somehow gets approved?
How about this, in a multiple generic scenario with Teva and an authorized generic, $40 million to MNTA seems to be the most probable result. How much is that income stream worth? Would seem to have a low risk of being maintained, and would grow with the lovenox market, tha lower priced generics would encourage.
An acquirer would need to pay a 35% or so in taxes. Tha would leave an annual cash flow of $26 million per year. How much do you pay for that? 5x, 10x, 15x? $250-$400 million at 10-15x. That is about the worse case scenario that I can envision for lovenox, and even at this MNTA will have a patent suit to defend its turf.
Current marketcap of $694 million - cash of, well a lot of cash. $170 million, $220 million. Worse case mLovenox seems to equal almost the entire value of the current enterprise value of MNTA, at least at 15x.
You can also do a DCF with this number instead of applying an arbitrary multiple. Using a DCF, with a 10% discount rate, and a 10 year growth rate for lovenox generic market of 4% and a 1% terminal growth rate, I get $417 million for the value of the after tax profit stream. Putting it into perspective of what an acquirer might pay for it to give us an idea as to how to value this worse case scenario.
Tinker
